Effect of Defense Expenditures on Economic Growth in D-8 Countries

Yıl 2025, Cilt: 14 Sayı: 3, 1032 - 1046, 10.07.2025

Engin Dursun , Mücella Bursal

https://doi.org/10.33206/mjss.1597653

Cited By: 1

https://izlik.org/JA65SF77ER

Öz

The aim of this study is to examine the impact of defense expenditures on economic growth in the D-8 countries, namely Turkey, Indonesia, Iran, Egypt, Pakistan, Malaysia, Nigeria and Bangladesh between 1993 and 2022. Panel unit root tests, homogeneity tests, Dumitrescu-Hurlin (2012) and Emirmahmutoğlu and Köse (2011) panel causality tests were applied in the study. According to the results of Dumitrescu-Hurlin (2012) panel causality test, there is a causality relationship from defense industry expenditures to GDP variable at 10% significance level at the first and third lags and 5% significance level at the second lag, and there is a causality relationship from GDP variable to defense industry expenditures variable at 1% significance level at all lag levels. According to Emirmahmutoğlu and Köse (2011) Panel causality test results, a causality relationship was found from defense industry expenditures to economic growth at 5% significance level in Bangladesh and Egypt, at 1% significance level in Indonesia and at 5% significance level in all countries. Moreover, a causality relationship from economic growth to defense industry expenditures was found at the 10% significance level in Bangladesh and Nigeria, at the 5% significance level in Egypt and Pakistan, and at the 1% significance level in all countries.

Anahtar Kelimeler

Military Expenditures , Economic Growth , Benoid Hypothesis , D-8 Countrıes.

Etik Beyan

During the writing process of the study “Effect of Defense Expenditures on Economic Growth in D-8 Countries” scientific rules, ethical and citation rules were followed. No falsification was made on the collected data and this study was not sent to any other academic publication medium for evaluation.

D-8 Ülkelerinde Savunma Harcamalarının Ekonomik Büyümeye Etkisi

https://izlik.org/JA65SF77ER

Öz

Bu çalışmanın amacı, D-8 ülkeleri olarak ifade edilen Türkiye, Endonezya, İran, Mısır, Pakistan, Malezya, Nijerya ve Bangladeş’in 1993-2022 yılları arasında yapmış olduğu savunma harcamalarının ekonomik büyümeye etkisini incelemektir. Çalışmada panel birim kök testleri, homojenlik testleri, Dumitrescu-Hurlin (2012) ve Emirmahmutoğlu ve Köse (2011) panel nedensellik testleri uygulanmıştır. Dumitrescu-Hurlin (2012) panel nedensellik testi sonuçlarına göre panel geneli ülkelerde savunma sanayi harcamalarından GSYİH değişkenine birinci ve üçüncü gecikmede %10, ikinci gecikmesinde %5 anlamlılık seviyesinde nedensellik ilişkisi bulunduğu, GSYİH değişkeninden savunma sanayi harcamaları değişkenine de tüm gecikme düzeylerinde %1 anlamlılık seviyesinde nedensellik ilişkisi olduğu tespit edilmiştir. Emirmahmutoğlu ve Köse (2011) Panel nedensellik testi sonuçlarına göre, savunma sanayi harcamalarından ekonomik büyümeye Bangladeş ve Mısır’da %5 anlamlılık seviyesinde, Endonezya’da ise %1 anlamlılık seviyesinde, ülkelerin genelinde ise %5 anlamlılık seviyesinde nedensellik ilişkisi bulgusu elde edilmiştir. Ayrıca ekonomik büyümeden savunma sanayi harcamalarına, Bangladeş ve Nijerya’da %10 anlamlılık seviyesinde, Mısır ve Pakistan’da ise %5 anlamlılık seviyesinde, ülkelerin genelinde ise %1 anlamlılık seviyesinde nedensellik ilişkisi olduğu tespit edilmiştir.

Anahtar Kelimeler

Savunma Harcamaları , Ekonomik Büyüme , Benoit Hipotezi , D-8 Ülkeleri.

Etik Beyan

“D-8 Ülkelerinde Savunma Harcamalarının Ekonomik Büyümeye Etkisi” başlıklı çalışmanın yazım sürecinde bilimsel kurallara, etik ve alıntı kurallarına uyulmuş; toplanan veriler üzerinde herhangi bir tahrifat yapılmamış ve bu çalışma herhangi başka bir akademik yayın ortamına değerlendirme için gönderilmemiştir.

Kaynakça

• Abushzada, F. (2022). Dynamic panel data analysis: The relationship between spendings on national defence and economic growth.
• Alper, A., & Oransay, G. (2015). Cari açık ve finansal gelişmişlik ilişkisinin panel nedensellik analizi ekseninde değerlendirilmesi. Uluslararası Ekonomi ve Yenilik Dergisi, 1(2), 73-85.
• Anyanwu, S., and Olu-Coris, A. J. (2011). Defence expenditure and economic growth in Nigeria: A vector error correction model (VECM) approach. Asian Journal of Empirical Research, 1(2), pp. 31-40.
• Arifin, Z., Suman, A., & Khusaini, M. (2019). Countertrade mechanism of global arms trade: case study of indonesia. International Journal of Financial Research, 11(1), 307. https://doi.org/10.5430/ijfr.v11n1p307
• Aydın, B. (2021). Theoretical and empirical literature of the relationship between defense expenditures and economic growth. Finans Ekonomi Ve Sosyal Araştırmalar Dergisi, 6(2), 208-215. https://doi.org/10.29106/fesa.858707
• Balaev, A. (2019). The structure of public spending and economic growth in Russia. Russian Journal of Economics, 5(2), 154-176.
• Bayoumi, T., Hewitt, D., and Symansky, S. (1998). The impact of worldwide military spending cuts on developing countries. Journal of Policy Modeling, 20(3), pp. 261 303.
• Becker, J. (2019). Accidental rivals? eu fiscal rules, nato, and transatlantic burden-sharing. Journal of Peace Research, 56(5), 697-713. https://doi.org/10.1177/0022343319829690
• Becker, J. (2021). Rusty guns and buttery soldiers: unemployment and the domestic origins of defense spending. European Political Science Review, 13(3), 307-330. https://doi.org/10.1017/s1755773921000102
• Belin, J., and Hartley, K. (2019). The Economics of the Global Defence Industry.
• Brasoveanu, L. (2010). The Impact of Defense Expenditure on Economic Growth. Journal for Economic Forecasting. 13. pp. 148-167.
• Breuer, J. B., McNown, R., & Wallace, M. (2002). Series-specific Unit Root Tests with Panel Data. Oxford Bulletin Of Economics And Statistics, 64(5), 527-546.
• Breusch, T. S., & Pagan, A. R. (1980). The Lagrange Multiplier Test and its Applications to Model Specification in Econometrics. The Review of Economic Studies (47-1), 239-253.
• Cappelen, A., Gleditsch, N., & Bjerkholt, O. (1984). Military spending and economic growth in the oecd countries. Journal of Peace Research, 21(4), 361-373. https://doi.org/10.1177/002234338402100404
• Cuaresma, J. and Reitschuler, G. (2006). ‘guns or butter?’ revisited: robustness and nonlinearity issues in the defense–growth nexus. Scottish Journal of Political Economy, 53(4), 523-541. https://doi.org/10.1111/j.1467- 9485.2006.00393.x
• Dash, D. P., Bal, D. P., and Sahoo, M. (2016). Nexus between defense expenditure and economic growth in BRIC economies: An empirical investigation.
• Deger, S. (1986) Economic development and defense expenditure, Economic Development and Cultural Change, 34, 179–96.
• Doğru, B. (2014), Euro Bölgesinde İşsizlik Histerezisinin İkinci Nesil Panel Birim Kök Testleri ile Analizi, Anadolu Üniversitesi Sosyal Bilimler Dergisi, Cilt 14, Sayı 3, 77-86.
• Dubauskas, G. (2021). Conditions influencing the change of defense budgets - the case of lithuania. Insights Into Regional Development, 3(2), 282-288. https://doi.org/10.9770/ird.2021.3.2(8)
• Dune, J. P. (2000). The Economic Effects of Military Expenditure in Developing Co-untries (NW4 4BT b.). Economics Group Middlesex University Business School, London.
• Dunne, P., Nikolaidou, E. and Vougas, D. (2001) Defence spending and economic growth: a causal analysis for Greece and Turkey. Defence and Peace Economics, 12, 5–26.
• Dumitrescu, E.-I., & Hurlin, C. (2012). Testing for Granger non-causality in heterogeneous panels. Economic Modelling, 29(4), 1450-1460.
• Emeru, G. (2023). Effect of public expenditure on economic growth in the case of ethiopia. The Scientific World Journal, 2023, 1-14. https://doi.org/10.1155/2023/9305196
• Emirmahmutoglu, F., & Köse, N. (2011). Testing for Granger causality in heterogeneous mixed panels. Economic Modelling 28.3 , 870-876.
• Erdoğdu, O. S. (2006). Political Decisions and Growth. Http://Mpra.Ub.Unimuenchen. De/2520/1/MPRA Paper 2520.
• Giray, F. (2004). Savunma harcamalari ve ekonomik büyüme. Cumhuriyet Üniversitesi İktisadi ve İdari Bilimler Dergisi, 5(1), 181-199.
• Galvin, H. (2002). The impact of defence spending on the economic growth of developing countries: a cross-section study. Defence and Peace Economics. 14. pp. 51-59.
• Gordon, L., Loeb, M., Lucyshyn, W., & Zhou, L. (2015). Externalities and the magnitude of cyber security underinvestment by private sector firms: a modification of the gordon-loeb model. Journal of Information Security, 06(01), 24-30. https://doi.org/10.4236/jis.2015.61003
• Hatemi‐J, A., Chang, T., Chen, W., Lin, F., & Gupta, R. (2017). Asymmetric causality between military expenditures and economic growth in top six defense spenders. Quality & Quantity, 52(3), 1193-1207. https://doi.org/10.1007/s11135-017-0512-9
• Hewitt, D. (1991). Military expenditure: international comparison of trends. Imf Working Paper, 91(54), i. https://doi.org/10.5089/9781451847420.001
• Kalaitzidakis, P. and Tzouvelekas, V. (2011). Military spending and the growth‐maximizing allocation of public capital: a cross‐country empirical analysis. Economic Inquiry, 49(4), 1029-1041. https://doi.org/10.1111/j.1465- 7295.2009.00242.x
• Kalyoncu, H. and Yücel, F. (2006). An analytical approach on defense expenditure and economic growth. Journal of Economic Studies, 33(5), 336-343. https://doi.org/10.1108/01443580610706564
• Karagol, E., & Palaz, S. (2004). Does defence expenditure deter economic growth in Turkey? A cointegration analysis. Defence and Peace Economics, 15(3), 289-298.
• Khiui, N. M., and Mahmood, A. (1997). Military expenditures and economic. Pakistan Development Review, 36(4), pp. 791-808.
• Koçbulut, Ö., & Altıntaş, H. (2016). İkiz Açıklar ve Feldstein-Horioka Hipotezi: OECD Ülkeleri Üzerine Yatay Kesit Bağımlılığı Altında Yapısal Kırılmalı Panel Eşbütünleşme Analizi. Erciyes Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi(48), 145-174.
• Kollias, C. (2004). 7 the Greek-Turkish Rapprochement, the Underlying Military Tension and Greek Defense Spending. Turkish Studies, 5(1), pp. 99-116.
• Kollias, C., Naxakis, C. and Zarangas, L. (2004c) Defence spending and growth in Cyprus: a causal analysis. Defence and Peace Economics 15(3) 299–307.
• Lai, C., Shieh, J., & Chang, W. (2002). Endogenous growth and defense expenditures: a new explanation of the benoit hypothesis. Defence and Peace Economics, 13(3), 179-186. https://doi.org/10.1080/10242690210975
• Lam, C., Franco, C., & Schuler, A. (2006). Billions for biodefense: federal agency biodefense funding, fy2006– fy2007. Biosecurity and Bioterrorism Biodefense Strategy Practice and Science, 4(2), 113-127. https://doi.org/10.1089/bsp.2006.4.113
• Maheswaranathan, S. and Jerusha, R. (2021). The impact of national defense expenditure on growth of economy in sri lanka. International Journal of Research -Granthaalayah, 9(3), 18-25. https://doi.org/10.29121/granthaalayah.v9.i3.2021.3710
• Maingi, J. (2017). The impact of government expenditure on economic growth in kenya: 1963-2008. Advances in Economics and Business, 5(12), 635-662. https://doi.org/10.13189/aeb.2017.051201
• Mintz, A. and Huang, C. (1990). Defense expenditures, economic growth, and the “peace dividend”. American Political Science Review, 84(4), 1283-1293. https://doi.org/10.2307/1963264
• Mueller, M. and Atesoglu, H. (1993). Defense spending, technological change, and economic growth in the united states. Defence Economics, 4(3), 259-269. https://doi.org/10.1080/10430719308404765
• Ngigi, C. (2023). Exploring the role of government spending in fostering economic development in kenya.. https://doi.org/10.21203/rs.3.rs-2942072/v1
• Nidhiprabha, B. (2015). Lessons from thailand's fiscal policy. Asian Economic Papers, 14(3), 110-125. https://doi.org/10.1162/asep_a_00384
• Pesaran, M. H. (2004). General diagnostic tests for cross section dependence in panels. CESifo Working Paper (1229), 1-40.
• Peseran, M. H. (2006), “A Simple Panel Unit Root Test in the Presence of Crosssection Dependecy”, Cambridge Working Papers in Economics, 0346.
• Pesaran, M. H., & Yamagata, T. (2008). Testing slope homogeneity in large panels. Journal of Econometrics, 142(1) , 50-93.
• Pesaran, M. H., Ullah, A., Yamagata T. (2008), “A Bias‐Adjusted LM Test of Error Cross‐Section Independence”, The Econometrics Journal, 11(1), 105-127.
• Rahman, T., and Siddiqui, D. A. (2019). The effect of military spending on economic growth in the presence of arms trade: A global analysis. SSRN Electronic Journal.
• Shahbaz, M., Leitão, N., Uddin, G., Arouri, M., & Teulon, F. (2013). Should portuguese economy invest in defense spending? a revisit. Economic Modelling, 35, 805-815. https://doi.org/10.1016/j.econmod.2013.08.038
• SIPRI (2020). Military Expenditure Database. https://www.sipri.org/databases/milex
• Stroup, M. and Heckelman, J. (2001). Size of the military sector and economic growth: a panel data analysis of africa and latin america. Journal of Applied Economics, 4(2), 329-360. https://doi.org/10.1080/15140326.2001.12040568
• Swamy, P. A. (1970). Efficient Inference in a Random Coefficient Regression Model. Econometrica, 38(2), 311- 323.
• Taş, S., Örnek, İ., ve Aksoğan, G. (2013). Türkiye’de Savunma Harcamaları, Büyüme ve Gelir Eşitsizliği, 1970- 2008: Ekonometrik Bir İnceleme. Gaziantep University Journal of Social Sciences, 12(3), 659-682.
• Tatoğlu, F. Y. (2018). Panel zaman serileri analizi. 2. Baskı İstanbul: Beta Yayınları.
• Torusdağ, M., & Gül, E. (2021). Defense Expenditures Current Account Deficit and Economic Growth Relationship: The Case of NATO Countries. Journal of Contemporary Issues in Business and Government Vol, 27(2).
• Yardımcıoğlu, F., & Gülmez, A. (2013). Türk Cumhuriyetlerinde ihracat ve ekonomik büyüme ilişkisi: Panel eşbütünleşme ve panel nedensellik analizi. Bilgi Ekonomisi ve Yönetimi Dergisi, 8(1), 145-161.